93-003269 Sheraton Associates Of Orange Park, Ltd. vs. Department Of Revenue Status: Closed Recommended Order on Friday, March 3, 1995.

Summary: Transfer of business by foreclouser was not a ""Sale"". Former owner liable for sales tax before transfer. Equitable Estoppel not proved.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

SHERATON ASSOCIATES OF ORANGE PARK, )

)

Petitioner, )

)

vs. ) CASE NO. 93-3269

)

STATE OF FLORIDA, )

DEPARTMENT OF REVENUE, )

)

Respondent. )

____________________________________)

RECOMMENDED ORDER

The final hearing in this was held before Larry J. Sartin, Hearing Officer,

on November 3, 1994 in Lake City, Florida.

APPEARANCES

For Petitioner: Thomas W Brown, Esquire

Brannon, Brown, Haley, Robinson

& Cole, P.A.

Post Office Box 1029

Lake City, Florida 32056-1029

For Respondent: Olivia P. Klein

Assistant Attorney General

Tax Section, Capitol Building

Department of Legal Affairs

Tallahassee, Florida 32399-1050

STATEMENT OF THE ISSUE

The issue in this case is whether Petitioner is liable for additional sales

tax in the amount of $71,118.95, plus penalties and interest, for the period

July 1, 1987 through February 13, 1991.

PRELIMINARY STATEMENT

Respondent, the Florida Department of Revenue, conducted an audit of

Petitioner, Sheraton Associates of Orange Park, Ltd., for the period July 1,

1987 through February 13, 1991. As a result of the audit, Respondent issued a

Notice of Proposed Assessment on March 24, 1992.

On or about November 30, 1992, Respondent issued a Notice of Decision

determining Petitioner to be liable for the audit assessment. Petitioner filed

a Petition for Reconsideration dated December 30, 1992. On or about April 13,

1993, Respondent issued a Notice of Reconsideration of Notice of Decision.

Respondent sustained the audit assessment against Petitioner

On or about June 9, 1993, Petitioner filed a Petition for Formal

Administrative Proceedings with Respondent requesting a formal administrative

hearing to contest Respondent's determination. The request for hearing was

filed with the Division of Administrative Hearings on June 10, 1993.

The final hearing of this matter was scheduled for October 25, 1993, by a

Notice of Hearing entered June 29, 1993. The hearing was subsequently continued

three times at the request of the parties to give the parties an opportunity to

settle their dispute.

By Order entered April 5, 1994, Petitioner was granted leave to file an

amended petition.

At the final hearing Petitioner presented the testimony of Greg Kaylor and

Philip A. Browning, Jr. Respondent presented the testimony of James Estey and

Perry L. Brown. The parties offered eight exhibits, including the deposition

testimony of Alan Markey Vaughn, as joint exhibits. The joint exhibits were

accepted into evidence.

The parties stipulated that the allegations of fact contained in paragraphs

1 through 10 (first paragraph only), and 11 through 13 of the amended petition

are true. Those facts have been included, to the extent relevant, in this

Recommended Order.

A transcript of the final hearing was filed on December 19, 1994.

Therefore, proposed recommended orders were required to be filed on or before

January 18, 1995. On December 22, 1994, Respondent filed an Agreed Motion to

Set Date Certain for Service of Parties' Proposed Recommended Orders. The

motion was granted by an Order entered December 23, 1994. Proposed recommended

orders were required to be served on or before January 30, 1995.

The parties filed proposed recommended orders on January 30, 1995. A

ruling on each proposed finding of fact contained in the proposed orders filed

by the parties has been made either directly or indirectly in this Recommended

Order or the proposed finding of fact has been accepted or rejected in the

Appendix which is attached hereto.

FINDINGS OF FACT

A. The Parties.

1. Petitioner, Sheraton Associates of Orange Park, Ltd. (hereinafter

referred to as "Sheraton Associates"), was formed as a Florida limited

partnership on November 15, 1973. It was formed to own a motel in Orange Park,

Florida. The business address of Sheraton Associates is Post Office Box 724848,

Atlanta, Georgia 31139

2. At all times relevant to this proceeding, Philip A. Browning, Jr., was

the general partner of Sheraton Associates.

3. Respondent, the Department of Revenue (hereinafter referred to as the

"Department"), is an agency of the State of Florida charged with responsibility

for, among other things, the assessment and collection Florida sales and use

tax. Chapter 212, Florida Statutes.

4. The following information was stipulated to be correct by the parties:

a. Sheraton Associates' employer identification number: 58-1178445;

b. DTA Number: 9201194;

c. Audit Number: 9021109195 Audit Period: 7/1/87 - 2/13/91;

d. Proposed Assessment and Sustained Amount: $69,142.65;

e. Local Government Infrastructure-Surtax

Audit Period: 2/1/90 - 2/13/91

Proposed Assessment and Sustained Amount: $1,976.30;

f. Amount Contested: Sales Tax $69,142.54

Surtax $ 1,976.30

B. The Operation of Sheraton Associates.

5. From 1974 until February 13, 1991, Sheraton Associates owned a Best

Western Motel (hereinafter referred to as the "Motel"), located in Orange Park,

Florida. The Motel (land and building) was the sole asset of Sheraton

Associates.

6. The purchase of the land and building for the Motel was financed

through Freedom Federal Savings and Loan of Tampa, Florida. Sheraton Associates

executed a Promissory Note and a Mortgage securing the payment of the note to

Freedom Federal Savings and Loan.

7. Sheraton Associates entered into a management agreement with Orange

Park Associates, Inc. (hereinafter referred to as "Orange Park Associates").

Pursuant to the agreement, Orange Park Associates operated the Motel, including

the restaurant and lounge, owned by Sheraton Associates.

8. Philip Browning, Jr., was the president and a director of Orange Park

Associates. Mr. Browning was also the general partner of Sheraton Associates.

Mr. Browning executed and delivered to Freedom Federal Savings and Loan as

further security for the Promissory Note from Sheraton Associates a Collateral

Assignment of Rents and Leases, an Assignment of Contracts, Licenses, Permits,

Trade Names and Documents and a Security Agreement for all other tangible and

intangible personal property.

9. Orange Park Associates operated the Motel on behalf of Sheraton

Associates for over sixteen years. The manager of the Motel was Greg Kaylor.

C. The Resolution Trust Corporation's Takeover of the

Motel Property.

10. The Resolution Trust Corporation (hereinafter referred to as the

"RTC"), took over all of the assets of Freedom Federal Savings and Loan as

receiver in late 1989 or early 1990.

11. Sheraton Associates defaulted on the Promissory Note to Freedom

Federal Savings and Loan. The RTC, therefore, commenced foreclosure on the

property of Sheraton Associates. A Notice of Lis Pendens seeking foreclosure on

the mortgage on the Motel property formerly held by Freedom Federal Savings and

Loan was issued by the RTC on or about July 16, 1990.

12. A Final Judgment of Foreclosure was entered in the Circuit Court,

Fourth Judicial Circuit, in and for Clay County, Florida, on or about December

7, 1990.

13. On or about February 13, 1991, the RTC took title to the Motel

property pursuant to foreclosure. The RTC continued to operate the Motel

through an entity known as Real Estate Recovery. Real Estate Recovery in turn

operated the Motel through an entity known as Tecton.

14. Mr. Kaylor was hired by Tecton. As of February 14, 1991, Mr. Kaylor

became manager of the Motel on behalf of Tecton.

D. The Department's Audit.

15. On or about March 12, 1991, James Estey informed Mr. Kaylor that the

Department intended to conduct an audit of the operation of the Motel. The

originally planned audit period was modified to reflect the transfer of the

assets of Sheraton Associates by Mr. Estey. The modified audit period was July

1, 1987 through February 13, 1991.

16. Although Mr. Kaylor was employed by Tecton after February 13, 1991,

Mr. Kaylor continued to act on behalf of Sheraton Associates with the

Department.

17. Mr. Kaylor made the records of the Motel available to Mr. Estey, acted

as the contact person for Sheraton Associates with Mr. Estey and kept Philip

Browning informed about the progress of the audit.

18. During Mr. Estey's first conversation with Mr. Kaylor, Mr. Estey was

informed that the RTC was the owner of the Motel property. Mr. Kaylor told Mr.

Estey that the RTC had taken over the property by "foreclosure."

19. Mr. Estey did not know what the RTC was. Nor did Mr. Estey understand

the RTC's connection with the Federal government. Mr. Estey assumed that the

RTC was simply a corporate business entity.

20. The evidence failed to prove that Mr. Kaylor told Mr. Estey that

Sheraton Associates had declared "bankruptcy." The Department, however, because

of Mr. Estey's lack of understanding of the RTC, believed that a transfer of the

assets of Sheraton Associates had been transferred pursuant to a bankruptcy

sale.

21. The audit of Sheraton Associates commenced in May of 1991.

22. On or about August 30, 1991, Mr. Estey presented his audit findings to

Mr. Kaylor by Notice of Intent to Make Sales and Use Tax Audit Changes. Mr.

Estey had determined that Sheraton Associates owed additional sales tax, plus

penalties and interest, for the audit period of $71,118.00

23. When informed that there was additional tax due for the audit period,

Mr. Kaylor inquired of Mr. Estey as to whether Sheraton Associates was liable

for the tax. Mr. Estey still believed that the RTC was just another corporation

and that the RTC had "acquired" the Motel property through bankruptcy.

Therefore, Mr. Estey informed Mr. Kaylor that the RTC would be liable for the

sales tax deficiency absent an agreement between Sheraton Associates and the RTC

to the contrary.

24. Mr. Kaylor informed Philip Browning of Mr. Estey's representations.

Philip Browning directed Mr. Kaylor to get the representation in writing from

Mr. Estey. Mr. Kaylor, therefore, requested that Mr. Estey confirm his

representations in writing concerning the liability of the RTC.

25. On September 4, 1991, Mr. Estey wrote, in part, the following to Mr.

Kaylor:

* * *

I checked with my supervisor, Mr. Perry Brown,

that DOR has no way of finding out if a private

agreement between Mr. Browning and the RTC

exists regarding tax liability. My supervisor's

position is that if an agreement does not exist,

then the liability for the taxes due falls on

the RTC per Florida law since RTC acquired the

business and is running it.

You may want to call Perry Browning for further

clarification on this particular issue. He may

be reached at 359-6077 also.

Joint Exhibit 1.

26. Mr. Kaylor confirmed Mr. Estey's representations in the September 4,

1991 letter by speaking by telephone with Mr. Estey's immediate supervisor,

Perry Brown. Perry Brown confirmed the representations of the letter.

27. Based upon Mr. Estey's letter of September 4, 1991, Sheraton

Associates took no immediate action to contest the sales tax deficiency alleged

in the August 30, 1991 Notice of Intent.

28. Information concerning the results of the audit were went to Philip

Browning.

29. Despite having been told that the RTC was liable for the sales tax

deficiency, on or about September 27, 1991, Alan Vaughn, Sheraton Associates'

accountant, requested an extension of time to challenge the findings of the

August 30, 1991 Notice of Intent. That request was granted and Sheraton

Associates was given until October 30, 1991, to respond to the Notice of Intent.

E. The Department's Change in Position.

30. In October of 1991 Mr. Estey telephoned Real Estate Recovery's or

Tecton's offices. For the first time, Mr. Estey realized that the RTC was not a

corporate business and that it was an agency of the Federal government.

31. Mr. Estey informed his supervisor, Perry Brown, who also was not aware

of what the RTC was, of his discovery concerning the RTC. Perry Brown then

wrote Mr. Vaughn on or about November 7, 1991 and informed him of the following:

Jim Estey contacted a representative of the

Resolution Trust Corporation and he is of

the opinion that Sheraton [sic] Associates

of Orange Park would be liable for the tax

due on this audit. I would agree with this

as the tax was or should have been collected

by them. They took over the operation in

lieu of foreclosure and did not purchase the

business.

I am extending the due date of the Notice of

Intent to make Audit changes until December 6,

1991. [Emphasis added].

* * *

F. Sheraton Associates' Protest.

32. By letter dated December 5, 1991, Sheraton Associates timely protested

the Department's determination of a sales tax deficiency. Sheraton Associates

contended that any tax deficiency was payable by the RTC and not Sheraton

Associates. Sheraton Associates did not challenge the accuracy of the alleged

sales tax deficiency in it's protest of December 5, 1991, or at any subsequent

time.

33. On November 30, 1992, the Department issued a Notice of Decision

sustaining the assessment.

34. On December 30, 1992, Sheraton Associates filed a Petition for

Reconsideration of Notice of Decision.

35. On April 13, 1993, the Department issued a Notice of Reconsideration

sustaining the assessment.

G. Sheraton Associates' Detriment.

36. The evidence in this case failed to prove that Sheraton Associates

relied upon the Department's initial representation that the RTC was liable for

the sales tax deficiency at issue in this proceeding to its detriment.

37. On August 30, 1991, Sheraton Associates was first informed by Notice

of Intent to Make Sales and Use Tax Audit Changes that Sheraton Associates was

liable for additional sales and use tax. Sheraton Associates was informed that

it could challenge this determination. While the Department erroneously

informed Sheraton Associates on September 4, 1991, that RTC was liable for the

tax, Mr. Vaughn, Sheraton Associates' accountant, was aware that the matter was

not final because of the outstanding August 30, 1991 Notice of Intent.

Therefore, on September 27, 1991, Mr. Vaughn requested an extension of time in

which to respond to the August 30, 1991 Notice. The time within which to file a

challenge to the Department's Notice of Sheraton Associate's liability was

extended until October 30, 1991. No effort was made by Sheraton Associates to

challenge the outstanding Notice of Intent, and it was not reasonable for

Sheraton Associates to ignore that Notice of Intent based upon a hand written

letter from the Department's auditor.

38 The Department reversed the position asserted in the September 4, 1991

letter from Mr. Estey on or about November 7, 1991. When informed of the change

in the Department's position, Sheraton Associates was given until December 6,

1991 to protest the Notice of Intent. This extension eliminated any possible

detriment to Sheraton Associates of the original representation from Mr. Estey

by giving Sheraton Associates an opportunity to do what it could have done when

first informed on August 30, 1991, that there was a sales tax deficiency:

challenge the Department's findings. Sheraton Associates in fact did so.

39. In support of its position that it suffered a detriment as a result of

Mr. Estey's letter, Sheraton Associates has asserted that it did not assess the

audit findings when they were first presented. The evidence failed to prove

that Sheraton Associates was prejudiced by not acting immediately or that its

actions in not protesting immediately were reasonable in light of the fact that

the Notice of Intent had not been withdrawn or modified by the Department.

40. Sheraton Associates has also asserted that its failure to retain its

records, which in turn makes it difficult to contest the Department's audit

findings, is part of its detrimental reliance. The evidence failed to prove,

however, when Sheraton Associates disposed of its records. In light of the fact

that the Notice of Intent issued on August 30, 1991, was not withdrawn or

modified by the Department to reflect the position asserted by Mr. Estey's

September 4, 1991 letter, it was not reasonable for Sheraton Associates to

dispose of the records.

41. Finally, Sheraton Associates assertion that it failed to pursue the

RTC was caused by Mr. Estey's letter. Again, it was unreasonable for Sheraton

Associates to rely on Mr. Estey's letter and not pursue the RTC while the Notice

of Intent remained outstanding.

CONCLUSIONS OF LAW

A. Jurisdiction.

42. The Division of Administrative Hearings has jurisdiction of the

parties to and the subject matter of this proceeding. Section 120.57(1),

Florida Statutes (1993).

B. Burden of Proof.

43. The burden of proof absent a statutory directive to the contrary is on

the party asserting the affirmative of the issue of the proceeding. Antel v.

Department of Professional Regulation, 522 So.2d 1056 (Fla. 5th DCA 1988);

Department of Transportation v. J.W.C. Co. Inc., 396 So.2d 778 (Fla. 1st DCA

1981); and Balino v. Department of Health and Rehabilitative Services, 348 So.2d

249 (Fla. 1st DCA 1977).

44. In this proceeding the burden of proof was on Sheraton Associates to

prove by a preponderance of the evidence that it is not liable for additional

sales tax for the audit period. Section 120.575(2), Florida Statutes.

C. Was there a Sale of the Business by Sheraton Associates

to the RTC Pursuant to Section 212.10(1), Florida

Statutes.

45. Section 212.10(1), Florida Statutes, governs the imposition of

liability for sales and use tax where there is a sale of a business:

If any dealer liable for any tax, interest,

or penalty hereunder shall sell out his

business or stock of goods, he shall make

a final return and payment within 15 days

after the date of selling the business; his

successor, successors, or assigns shall

withhold a sufficient portion of the purchase

money to safely cover the amount of such

taxes, interest, and penalties due and unpaid

until such former owner shall produce a receipt

from the department showing that they have been

paid or a certificate stating that no taxes,

interest or penalty are due. If the purchasers

of a business or stock of goods shall fail to

withhold a sufficient amount of the purchase

money as above provided, he shall be personally

liable for the payment of the taxes, interest

and penalties accruing and unpaid on the account

of the operation of the business by any former

owner, owners or assigns.

46. Pursuant to Section 212.10(1), Florida Statutes, the liability for any

outstanding sales tax liability is placed on both the seller and buyer where a

business is sold.

47. Rule 12A-1.055, Florida Administrative Code, provides guidance

governing the sales tax consequences of the sale of a business.

48. Significantly, Rule 12A-1.055(3)(c)2., Florida Administrative Code,

provides the following:

(c) A business is deemed not to have been

"sold out" when:

* * *

2. Real or tangible property of a business

is transferred by foreclosure . . . .

49. The evidence in this case proved that the transfer of Sheraton

Associates' assets was by foreclosure. Pursuant to the language of Rule 12A-

1.055(3)(c)2., Florida Administrative Code, quoted in paragraph 48, the

foreclosure of Sheraton Associates business is specifically excluded from being

treated as a "sale" pursuant to Section 212.10(1), Florida Statutes. Therefore,

any liability for sales tax during the audit period prior to the foreclosure by

the RTC is the responsibility of Sheraton Associates and there is no authority

for the Department to seek payment of any part of that liability from the RTC.

50. Rule 12A-1.055(3)(c)2., Florida Administrative Code, is consistent

with the court's interpretation of Section 212.10(1), Florida Statutes, in State

of Florida ex rel., Sir Richards, Inc. v. Lewis, 9 Fla. Supp. 2d 68 (Leon Cir.

Ct. 1984).

51. Sheraton Associates has relied on the definition of "sale" found in

Section 212.02(16), Florida Statutes, in support of its argument that it sold

out its business to the RTC. Sheraton Associates' reliance on this provision is

misplaced. Section 212.02(16), Florida Statutes, only defines the term "sale"

for purposes of determining whether that has been a sale of tangible personal

property for purposes of Chapter 212, Florida Statutes. It is not intended to

apply to the sales of businesses which is governed by the more specific

provisions of Section 212.10(1), Florida Statutes. Sheraton Associates'

argument also ignores the clear pronouncement of Rule 12A-1.055(3)(c)2., Florida

Administrative Code.

52. Sheraton Associates has also cited Jacobs v. Kirk, 223 So. 2d 795

(Fla. 4th DCA 1969), in support of its position. The facts in that case are

distinguishable from the facts in this case.

53. It is concluded that there has been no sell off of the business of

Sheraton Associates pursuant to Section 212.10(1), Florida Statutes. Therefore,

Sheraton Associates is liable for any sale tax liability prior to February 14,

1991.

D. Does the Doctrine of Equitable Estoppel Apply.

54. Sheraton Associates has argued that, if Section 212.10(1), Florida

Statutes, does not apply to this matter, the Department is estopped from

collecting any sales tax liability from it.

55. In order to establish that the doctrine of equitable estoppel applies,

Sheraton Associates was required to prove the following factors:

a. There was a representation of a material

fact by the Department that is contrary to a

later-asserted position of the Department;

b. Sheraton Associates reasonably relied

upon the earlier representation; and

c. The Department's change in position was

detrimental to Sheraton Associates.

See Department of Revenue v. Anderson, 403 So.2d 397 (Fla. 1981); and Kuge v.

Department of Administration, Division of Retirement, 449 So.2d 389 (Fla. 3d DCA

1984).

56. The Department does not dispute that its employee, Mr. Estey,

misinformed Sheraton Associates. Nor does the evidence support a finding that

the Sheraton Associates was not misinformed. The evidence proved that Sheraton

Associates was mistakenly told that another entity was liable for the sales

taxes at issue. See Hardy, Hardy & Associates, Inc. v. Department of Revenue,

308 So.2d 187 (Fla. 1st DCA 1975).

57. While there was a misrepresentation to Sheraton Associates by the

Department, Sheraton Associates failed to prove that it reasonably relied on the

misrepresentation or that it suffered any detrimental reliance.

58. Sheraton Associates should not have relied upon Mr. Estey's letter to

take no action to contest the proposed assessment of tax contained in the Notice

of Intent provided to it on August 30, 1991 as long as that Notice of Intent was

still outstanding and unamended. Sheraton Associates knew, or should have

known, the consequences of not challenging the Notice of Intent. Its accountant

evidenced his understanding of the impact of the Notice of Intent when he

requested an extension of time on September 27, 1991, to respond to the Notice

of Intent. Had it been reasonable to rely on the letter from Mr. Estey and

ignore the Notice of Intent, there would have been no need to request an

extension of time to reply to the Notice.

59. Even if Sheraton Associates had been reasonable in relying on Mr.

Estey's letter while ignoring the position taken by the Department in the Notice

of Intent, it failed to prove it suffered any detriment. Even after the

Department notified Sheraton Associates that Mr. Estey's letter was incorrect,

Sheraton Associates had the opportunity to challenge the Department's proposed

assessment. It chose not to do so. While the destruction of its records may

have made it difficult, or even impossible, to contest the assessment, Sheraton

Associates failed to prove when the records were disposed of or that the

destructions of the records was reasonable. Additionally, the destruction of

the records was contrary to the requirements of the Department's rules. See

Rule 12A-1.055(5)(a) and Rule 12A-1.093, Florida Administrative Code.

60. Based upon the foregoing, it is concluded that Sheraton Associates has

failed to prove that the doctrine of equitable estoppel applies in this case.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is

RECOMMENDED that a final order be entered by the Department of Revenue

sustaining its August 30, 1991 assessment of additional sales tax, plus

penalties and interest, and local government infrastructure surtax, plus

penalties and interest.

DONE AND ENTERED this 3rd day of March, 1995, in Tallahassee Florida.

___________________________________

LARRY J. SARTIN

Hearing Officer

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

[phone]

Filed with the Clerk of the

Division of Administrative Hearings

this 3rd day of March, 1995.

APPENDIX

The parties have submitted proposed findings of fact. It has been noted

below which proposed findings of fact have been generally accepted and the

paragraph number(s) in the Recommended Order where they have been accepted, if

any. Those proposed findings of fact which have been rejected and the reason

for their rejection have also been noted.

Sheraton Associates' Proposed Findings of Fact

1 Accepted in 1.

2 Accepted in 2 and hereby accepted.

3 Accepted in 4.

4 Accepted in 35.

5 Accepted in 1.

6 Accepted in 7.

7 Accepted in 9-10 and 12-13.

8 Accepted in 13.

9 Accepted in 13 and 15.

10 Accepted in 22.

11 Accepted in 33.

12 Accepted in 34.

13 Accepted in 35.

14 Hereby accepted.

15 Accepted in 25.

16 Hereby accepted.

17 Not supported by the weight of the evidence. See 18-20.

18 Accepted in 26.

19 Not supported by the weight of the evidence. See 36-41.

20 Not relevant.

21 Not supported by the weight of the evidence.

The Department's Proposed Findings of Fact

1 Accepted in 1.

2 Accepted in 3 and hereby accepted.

3 Accepted in 4.

4 Accepted in 35.

5 Accepted in 1.

6 Accepted in 7.

7 Accepted in 9-10 and 12-13.

8 Accepted in 13.

9 Accepted in 13 and 15.

10 Accepted in 22.

11 Accepted in 33.

12 Accepted in 34.

13 Accepted in 35.

14 Hereby accepted.

15 Accepted in 5.

16 Accepted in 7.

17 Accepted in 2.

18 Accepted in 8-9.

19 Accepted in 15-16.

20 See 18-20.

21 Accepted in 21.

22 Accepted in 22 and hereby accepted.

23 Hereby accepted.

24 Accepted in 22-23.

25 Accepted in 23.

26 Accepted in 19-20.

27 Accepted in 24.

28 Accepted in 25.

29 Accepted in 28.

30 Cumulative. Not relevant.

31 Accepted in 29.

32 Accepted in 30

33 Accepted in 31.

34 Accepted in 32.

35-36 Hereby accepted.

37 Accepted in 6.

38 Accepted in 8.

39 Accepted in 11.

40 Accepted in 10-13.

41 Hereby accepted.

42 Accepted in 9.

COPIES FURNISHED:

Donna Houghton Thames, Esquire

Thomas W Brown, Esquire

Post Office Box 1029

Lake City, Florida 32056-1029

Olivia P. Klein

Assistant Attorney General

Jarrell L. Murchison

Assistant Attorney General

Tax Section, Capitol Building

Department of Legal Affairs

Tallahassee, Florida 32399-1050

Larry Fuchs

Executive Director

104 Carlton Building

Tallahassee, Florida 32399-0100

Linda Lettera

General Counsel

204 Carlton Building

Tallahassee, Florida 32399-0100

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended

Order. All agencies allow each party at least 10 days in which to submit

written exceptions. Some agencies allow a larger period within which to submit

written exceptions. You should contact the agency that will issue the final

order in this case concerning agency rules on the deadline for filing exceptions

to this Recommended Order. Any exceptions to this Recommended Order should be

filed with the agency that will issue the final order in this case.